National Association of Home Builders Discusses Economics and Housing Policy

Millennials and the American Dream

A recent survey of younger Americans illustrates that the goal of homeownership remains an important part of the American Dream.

The economic future of Millennials is key to the future of housing demand. A record number of individuals aged 18 to 34 years are delaying household formation as a consequence of the Great Recession. In a recent post, we referred to this situation as the Great Delay, as slow wage growth and rising student loan burdens have reduced attainment of traditional goals associated with the American Dream, including marriage and homeownership.

An important research question is whether these delays represent deferrals due to economic conditions or true changes in preferences and goals.

A recent survey from the Demand Institute provides new evidence. The study surveyed 1,000 18 to 29 year olds about current conditions and market preferences. The findings indicate that homeownership remains an important long-term goal.

Among the findings for Millennials:

Over the next 5 years, 8.3 million new Millennial households will form

74% plan to move over the next five years, with the top reason being need for better housing

64% expect to be married in five years and 55% expect to have kids

75% believe homeownership is an important long-term goal and 73% believe ownership is an excellent investment

24% currently own a home and another 60% plan to purchase

36% expect their next home to be a multifamily rental, while another 36% expect it to be a single-family owner-occupied residence

48% prefer their next home to be in the suburbs, while 38% want urban locations